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A Matter of Trust

Apple is reportedly building an iCloud, but would you want to be on it when the company is being accused of tracking iPhone and iPad owners? Meanwhile, Google is being sued over the location data it collects for Android phones. Dropbox changed its terms of service to say it would allow law enforcement access to its users' files. And the Sony PlayStation Network was just hacked, potentially exposing customers’ credit card info. As companies and criminals look to get their hooks into more and more of our information stored in the cloud, consumer trust is eroding faster than you can say "GPS tracking."

Apple’s troubles started when British researchers discovered last week that the iPhone and iPad was recording a large amount of user location data and then storing it in an unencrypted file that was backed up to customers’ computers. It took a full week for Apple to respond, which came in the form of a Q & A that denied that the company was tracking users. And while Apple admitted to some software bugs that will be fixed, it didn’t fully address the concerns of consumers or lawmakers. It’s not a good sign when South Park lampoons you as Big Brother, which is what happened this week when one character was surprised to learn that Apple knew his every move. As it turns out, Washington isn’t laughing.

On May 10th representatives from Apple and Google are expected to testify at a Congressional hearing on consumer privacy and smartphones. Sen. Al Franken said in a statement that the hearing was a “first step” in Congressional inquiries into whether federal laws have kept up with the pace of mobile tech. Sen. Patrick Leahy (D-Vt.), the chairman of the Senate’s Judiciary Committee, added that “it is essential that policy makers and the American people have complete and accurate information about the privacy implications of these new technologies.” It’s the complete part that seems especially lacking.

I hope that both Apple and Google will shed more light on how they’re using the data they collect. How is location information being shared with third parties? Can consumers truly opt out? To use Apple’s own words from its Q & A, it’s not just a matter of educating users who are “confused.” It’s about maintaining—or reestablishing—trust in brands to which we provide very sensitive and personal information. Is all of this worth suing over? I’m not so sure, but that isn’t stopping two Michigan women from going after Google in court. Their complaints says that the tracking of their Android phones “puts users at serious risk of privacy invasions, including stalking.”

In the case of Sony, PlayStation owners are the ones who feel like they’re being stalked right now. After its PlayStation Network was attacked by hackers, Sony doesn’t just have to recover from an extended outage. It admitted in its own posted Q & A that it could not rule out the possibility that credit card data was taken, even though the company said “the entire credit card table was encrypted.” That doesn’t sound very reassuring, and now The New York Times reports that the hackers claim to have PlayStation users’ credit card numbers.

Right now it seems as though the cloud is growing and evolving so quickly that the companies that rely on it to deliver services aren’t stopping to think about the ramifications and dangers. And the more incidences like this that pile up, the more consumers will question whether to retreat from the very innovations that are supposed to enhance our lives—and fuel the digital economy.

Consumers also need to accept some responsibility by being more vigilant about what it is they’re signing up for when they casually click OK to every user agreement that comes their way. The industry and users alike need to focus on ways to limit the potential for identity theft by promoting single-use credit card numbers or other payment methods that have no value to hackers. It’s time to stop blindly trusting technology and to start demanding transparency and better protection of our personal information.